PublishersLunch
Amazon continues to grow sales and produce very little income, reportingrevenues of $13.18 million for their first quarter (up 34 percent) and net income of $130 million (down 35 percent).
North American media sales of $2.197 billion were up 17 percent, and international media sales of $2.513 billion rose 21 percent. The press release leads by trumpeting having persuaded authors of 130,000 KDP titles to make their works exclusive to Amazon so that Prime members can borrow them for free.
In the investor q&a Thursday night, cfo Thomas Szkutak reiterated of the recent DOJ action that "we do think that the suit is a big win for Kindle owners. And we look forward to being allowed to lower prices on more Kindle books." An analyst tried to explore how much the agency model has contributed to the growth in Amazon's reported third-party sales (since the publishers became the sellers of their ebooks) but it did not yield a very specific answer: "Certainly, the paid unit growth [in general] has been certainly helped a lot by e-books."
For the quarter ahead, sales are forecast to "grow between 20 percent and 34 percent" and operating income is seen ranging from a $260 million loss up to a slim $40 million gain. Sales for the first quarter were at the high range of their previous forecasts, and the small net income and operating figures were above the pessimistic range that had spooked investors three months ago--so Amazon's stock rose sharply in after-hours trading Thursday night and is up close to 15 percent in early Friday trading